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So I started this exercise and got to question 2 and got stumped. Could you please show all of the calculations involved step by step

So I started this exercise and got to question 2 and got stumped. Could you please show all of the calculations involved step by step so I can following along on the next exercise. Each box needs filled in. On # 3 the question ask for _______ payments _______ require entries.

Hillside issues $1,400,000 of 5%, 15-year bonds dated January 1, 2016, that pay interest semiannually on June 30 and December 31. The bonds are issued at a price of $1,713,594.

1. Prepare the January 1, 2016, journal entry to record the bonds issuance.

Date General Journal Debit Credit
Jan 01, 2016 Cash 1,713,594
Bonds payable 1,400,000
Premium on bonds payable 313,594

2. (a) For each semiannual period, complete the table below to compute the cash payment.

Par (maturity) value

Annual Rate

Year

Semiannual cash interest payment

$1,400,000

x

5.0%

x

6/12

=

$35,000

2. (b) For each semiannual period, complete the table below to compute the straight-line premium amortization.

Bond price

Par (maturity value)

Premium on Bonds Payable

Semiannual periods

Straight-line premium amortization

=

=

2. (c) For each semiannual period, complete the table below to compute the bond interest expense.

Semiannual cash payment

Premium amortization

Bond interest expense

=

3. Complete the below table to compute the total bond interest expense to be recognized over the bonds' life.

Total bond interest expense over life of bonds:

Amount repaid:

payments of

Par value at maturity

Total repaid

0

Less amount borrowed

Total bond interest expense

$0

4. Prepare the first two years of an amortization table using the straight-line method

Semiannual Period-End

Unamortized Premium

Carrying Value

01/01/2016

06/30/2016

12/31/2016

06/30/2017

12/31/2017

5. Prepare the journal entries to record the first two interest payments.

Journal Entry Worksheet

Record the first interest payment on June 30, 2016.

Record the second interest payment on December 31, 2016.

Date General Journal Debit Credit
Jun 30, 2016

*Enter debits before credits

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